Aggressive Bids Adversely Affecting the Sector – Rooftop Solar Integrators to MNRE

The group wants the ministry to ensure bidders do not quote abnormally low tariffs


Solar Parivar, an Uttar Pradesh-based group connected with the solar energy sector, has requested the Ministry of New and Renewable Energy (MNRE) to resolve issues faced by rooftop solar integrators.

In a letter to MNRE, the group said the ministry should carry out an intensive study and ask manufacturers for the prices of solar equipment instead of relying on the lowest tariff discovered in each state as the basis to calculate the benchmark cost.

The benchmark costs include the cost of solar modules, inverters, the balance of systems, civil works, installation, commissioning, transportation, and comprehensive maintenance for five years. The benchmark costs do not include net-metering and battery back-up costs.

The group urged the ministry to ask the lowest bidders for rate justification with purchase invoices of all equipment to be used in solar systems. This would prevent bidders from quoting abnormally low rates.

It also wants the ministry to allow beneficiaries to select products of their choice and set benchmark costs only to calculate subsidies.

The group said vendors are unable to install solar power projects at rates discovered over a year ago due to an upsurge in solar panel costs after the lockdown enforced by the COVID-19 pandemic and a 15% increase in import duty on solar inverters in the latest budget.

On the issue of subsidies for rooftop solar projects, Solar Parivar said that distribution companies or state nodal agencies were not providing subsidies to vendors within specified timelines. Delays in releasing the subsidies increased the burden of bank interests on vendors which is not included in the benchmark cost. It requested the ministry to ensure that timelines for the release of subsidies are not violated.

In July 2020, the ministry issued benchmark costs for grid-connected rooftop solar projects for the financial year (FY) 2020-21. Benchmark costs for rooftop systems with 3 kW to 10kW capacity were reduced to ₹41(~$0.55)/W in FY 2020-21 from ₹54 (~$0.72)/W in FY 2019-20.

Harsh Shukla is a staff reporter at Mercom India. Previously with Indian Express, he has covered general interest stories. He holds a Masters Degree in Journalism from Symbiosis Institute of Media and Communication, Pune.

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